Pakistan Petroleum Limited (PPL) may make impairment of up to Rs 4 billion in the assets of MND Exploration and Production Limited (MND), said company secretary Shahana Ahmed Ali on Tuesday. PPL had acquired MND, then having non-operated exploration and production assets in Pakistan and Yemen, under a Sale Purchase Agreement on August 30, 2012 after Economic Co-ordination Committee of the federal cabinet approved it.
The need for a possible impairment came after a reputable international consulting firm, engaged by PPL on the instructions of its Board of Directors, valued MND assets lesser than the company had at time of acquisition. "The consultant's report has just been received by us and the consultant has evaluated the assets of MND at a lesser value than PPL's valuation as at the date of acquisition thereof," Shahana told Pakistan Stock Exchange in a stock filing.
Therefore, she said PPL was reviewing the consultant's report to asset whether asset impairment is necessary as at 30th June 2016. "That may range between PKR zero to four billion," the company official added.
PPL, she said, had engaged the international consultants for carrying out an independent valuation of MND's assets. "The scope of work of the Consultant required it to consider the value of the assets as at the date of the acquisition and to base the valuation on data available to PPL at that time," she said. "The report of the consultant is being reviewed by the management of PPL," Shahana said adding the matter would also be placed before the next meeting of the Board of Directors.